Otter Tail (NASDAQ: OTTR) 2025 EPS $6.55 and lower 2026 guidance

Rhea-AI Filing Summary

Otter Tail Corporation reported 2025 diluted earnings per share of $6.55, with a consolidated return on equity of 16% on an equity ratio of 63%. The Electric segment grew operating revenue 8.1% and net income 7.3%, helped by higher sales volumes, fuel recovery and favorable weather, partly offset by higher depreciation and interest costs.

The Manufacturing segment saw operating revenue decline 8.2% and net income fall 15.8% as softer demand in key end markets weighed on volumes, though cost actions improved margins. Plastics segment operating revenue declined 8.8% and net income decreased 15.1% as PVC pipe prices fell from 2024 peaks, partly offset by higher volumes and lower resin costs.

Operating cash flow was $386.0 million, funding $288.1 million of capital expenditures, mainly in the Electric segment. For 2026, the company guides diluted EPS to $5.22–$5.62, with an expected return on equity of 11.5%–12.3% and a roughly balanced earnings mix between Electric and non‑electric businesses. A five‑year, $2.05 billion capital plan is expected to drive about 10% average annual growth in the Electric segment rate base.

Insights

Equity analyst

2025 results were solid but down from 2024, with guidance implying another step down as plastics normalize while utility growth accelerates.

Otter Tail delivered 2025 diluted EPS of $6.55, with strong Electric performance offset by weaker Manufacturing and Plastics. Electric revenue rose 8.1% and net income 7.3%, benefiting from higher volumes, fuel recovery and weather. Plastics earnings fell as PVC pipe prices declined from unusually high 2024 levels despite higher volumes and lower resin costs.

Cash generation remained robust, with operating cash flow of $386.0M versus capital expenditures of $288.1M, leaving ample room to fund growth and dividends. Management outlined a $2.05B capital plan for 2026–2030, primarily in renewable generation, storage, and transmission, supporting about 10% annual Electric rate base growth.

For 2026, EPS guidance of $5.22–$5.62 implies lower earnings than 2025 as Plastics segment EPS is projected to decline about 36% while Electric EPS is expected to rise roughly 14%. The company targets long‑term EPS growth of 7–9% and total shareholder return of 10–12%, contingent on executing its utility capital plan and managing cyclical manufacturing and plastics demand.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): February 16, 2026

OTTER TAIL CORPORATION

(Exact name of registrant as specified in its charter)

Minnesota (State or other jurisdiction of incorporation or organization) 0-53713 (Commission File Number) 27-0383995 (I.R.S. Employer Identification No.)

215 South Cascade Street, P.O. Box 496, Fergus Falls, MN 56538-0496

(Address of principal executive offices, including zip code)

(866) 410-8780

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:

Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Common Shares, par value $5.00 per share			OTTR			The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Item 2.02    Results of Operations and Financial Condition

On February 16, 2026 Otter Tail Corporation issued a press release announcing its consolidated financial results for the quarter and year ended December 31, 2025, and its earnings guidance for 2026. A copy of the press release is furnished herewith as Exhibit 99.1.

The information in this Item 2.02 (including Exhibit 99.1 attached hereto) shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except as shall be expressly set forth by specific reference in such filing.

Item 9.01    Financial Statements and Exhibits

(d)			Exhibits
			99.1			Press Release issued February 16, 2026.
			104			Cover Page Interactive Data File (embedded within the Inline XBRL document).

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

			OTTER TAIL CORPORATION
Date: February 17, 2026			By:			/s/ Todd R. Wahlund
						Todd R. Wahlund
						Chief Financial Officer

Press Release

February 16, 2026

Otter Tail Corporation Announces Annual Earnings and Initiates 2026 Earnings Guidance

FERGUS FALLS, Minnesota - Otter Tail Corporation (Nasdaq: OTTR) today announced financial results for the quarter and year ended December 31, 2025.

SUMMARY

•Produced annual diluted earnings per share of $6.55.

•Achieved a consolidated return on equity of 16% on an equity ratio of 63%.

•Initiated 2026 diluted earnings per share guidance range of $5.22 to $5.62, a return on equity projection of 12% at the midpoint.

CEO OVERVIEW

"We are pleased with our 2025 financial results as they exceeded our expectations for the year,” said President and CEO Chuck MacFarlane. “Our results are fueled by our team members’ efforts, and I am proud of the ways they delivered for our customers and shareholders amidst dynamic market conditions.

“Throughout 2025, Otter Tail Power navigated a full agenda and our team members rose to the occasion. We made significant progress on a number of our capital projects, including our wind repowering, solar development and large regional transmission projects, all while executing on our regulatory priorities. We filed rate cases in South Dakota and Minnesota for the first time since 2018 and 2020, respectively. Even with the proposed increases, Otter Tail Power will continue to have some of the lowest electric rates in the region and country.

“Otter Tail Power’s capital spending plan for 2026 through 2030 remains robust. We have identified a pipeline of high-quality projects that provide safe, reliable and increasingly clean electric service for our customers. We are reaffirming our five-year rate base compounded annual growth rate of 10 percent.

“Our Manufacturing segment businesses continued to face soft end market demand following a sharp decline in sales volumes beginning in the third quarter of 2024. Our team members did an excellent job aligning our cost structure with the current demand environment while ensuring we remained well-positioned to respond when conditions improved. This positioning became important towards the end of 2025 as customer order activity picked up, enabling us to end the year with momentum.

“Our Plastics segment businesses continued to provide significant value to our organization even as segment earnings receded from record levels last year, and I am proud of how our team members navigated these changing market conditions. We benefitted from increased sales volumes enabled by the incremental production capacity and large-diameter capability added at Vinyltech in late 2024, partially offsetting the impact of lower PVC pipe sales prices. We expect to complete the second phase of our Vinyltech expansion project in early 2026.

“We are initiating our 2026 diluted earnings per share guidance range of $5.22 to $5.62 and affirming our long-term financial targets. The fundamentals of our business and diversified portfolio remain strong and we are confident in our ability to deliver on our growth plan for the benefit of our customers and shareholders. We continue to target a long-term earnings per share growth rate of 7 to 9 percent, resulting in a total shareholder return of 10 to 12 percent.”

CASH FLOWS AND LIQUIDITY

Our consolidated cash provided by operating activities was $386.0 million in 2025, compared to $452.7 million in 2024. The decrease was primarily driven by higher working capital requirements, including the timing of fuel cost and rider recoveries from our utility customers, and lower earnings.

Investing activities during the year included capital expenditures of $288.1 million. These expenditures were primarily within our Electric segment and included investments in our wind repowering initiatives, solar facilities, and other projects.

Financing activities in 2025 included the issuance of $100.0 million of long-term debt at Otter Tail Power, with the proceeds used to repay short-term borrowings, fund capital investments, and support operating activities. Other financing activities during the year included dividend payments of $88.1 million.

As of December 31, 2025, we had $319.3 million of available liquidity under our credit facilities and $386.2 million of available cash and cash equivalents, for total available liquidity of $705.5 million.

ANNUAL SEGMENT OPERATING RESULTS

Electric Segment

($ in thousands)			2025						2024						$ Change						% Change
Operating Revenues			$	566,756					$	524,515					$	42,241					8.1		%
Net Income			97,586						90,963						6,623						7.3
Retail MWh Sales			5,917,736						5,681,268						236,468						4.2		%
Heating Degree Days			6,117						5,313						804						15.1
Cooling Degree Days			492						440						52						11.8

The following table shows heating and cooling degree days as a percent of normal.

			2025						2024
Heating Degree Days			97.1		%				83.7		%
Cooling Degree Days			102.5		%				93.8		%

The following table summarizes the estimated effect on diluted earnings per share of the difference in retail kilowatt-hour (kwh) sales under actual weather conditions and expected retail kwh sales under normal weather conditions in 2025 and 2024.

			2025 vs Normal						2025 vs  2024						2024 vs Normal
Effect on Diluted Earnings Per Share			$	(0.03)					$	0.10					$	(0.13)

Operating Revenues increased $42.2 million largely due to increased fuel recovery revenues, recovery of our rate base investments, increased residential and commercial sales volumes, and the impact of favorable weather compared to last year. The increase in fuel recovery revenue was driven by increased customer demand as well as higher market energy and natural gas prices. These factors were partially offset by a net decrease in rider revenues resulting from higher production tax credits during the year following the completion of certain of our wind repowering projects and the commencement of tax credit generation which decreased income tax expense and offset rider revenue. These credits are passed through to customers, reducing operating revenue.

Net Income increased $6.6 million primarily due to higher retail revenues, as discussed above, and lower operating and maintenance expenses. These items were partially offset by higher depreciation and interest expense related to our rate base investments and the associated financing costs. In addition, a decrease in pension and postretirement related gains further offset the increase in operating revenues and decrease in operating and maintenance expenses.

Manufacturing Segment

(in thousands)			2025						2024						$ Change						% Change
Operating Revenues			$	314,547					$	342,592					$	(28,045)					(8.2)		%
Net Income			11,517						13,681						(2,164)						(15.8)

Operating Revenues decreased $28.0 million primarily driven by a 6% decline in sales volumes, with reductions across several end markets, including agriculture, lawn and garden and recreational vehicles. Sales volumes were negatively affected by soft demand and inventory management efforts by manufacturers and dealers throughout much of the year, continuing a trend that began in the third quarter of 2024. A 1% decrease in steel costs, which are passed through to customers, also contributed to the decrease in operating revenues.

Net Income decreased $2.2 million primarily driven by lower sales volumes, as described above, and higher general and administrative expenses. These impacts were partially offset by higher profit margins from improved production efficiencies and reduced production costs, as we continue to align our cost structure with current demand levels.

Plastics Segment

(in thousands)			2025						2024						$ Change						% Change
Operating Revenues			$	422,755					$	463,441					$	(40,686)					(8.8)		%
Net Income			170,400						200,747						(30,347)						(15.1)

Operating Revenues decreased $40.7 million primarily driven by a 15% decline in average sales prices compared to last year. Prices have been declining for several years after peaking in late 2022. The impact of lower sales prices was partially offset by an 8% increase in sales volumes, largely driven by additional production capacity following the completion of the first phase of our expansion project at Vinyltech in late 2024.

Net Income decreased $30.3 million as a result of decreased sales prices, as described above, partially offset by a 14% decrease in PVC resin and other input material costs and the 8% increase in sales volumes.

Corporate

(in thousands)			2025						2024						$ Change						% Change
Net Loss			$	(3,610)					$	(3,729)					$	119					(3.2)		%

FOURTH QUARTER OPERATING RESULTS

Consolidated Results

(in thousands, except per share amounts)			2025						2024						$ Change						% Change
Operating Revenues			$	308,099					$	303,111					$	4,988					1.6		%
Operating Expenses			240,480						236,287						4,193						1.8
Operating Income			67,619						66,824						795						1.2
Other Expense			6,014						3,821						2,193						57.4
Income Before Income Taxes			61,605						63,003						(1,398)						(2.2)
Income Tax Expense			9,831						8,153						1,678						20.6
Net Income			51,774						54,850						(3,076)						(5.6)
Diluted Earnings Per Share			$	1.23					$	1.30					$	(0.07)					(5.4)		%

Electric Segment

Electric segment net income was $26.4 million, a $4.9 million increase from the fourth quarter of 2024. The increase was primarily driven by lower operating and maintenance expenses, higher residential and commercial sales volumes, and the impact of favorable weather compared to the same period last year. These benefits were partially offset by higher depreciation and interest expense associated with our rate base investments and related financing costs.

Manufacturing Segment

Manufacturing segment net income was $2.6 million, an increase of $3.2 million from a net loss of $0.6 million in the fourth quarter of 2024. The increase was primarily driven by an 11% increase in sales volumes and improved profit margins compared to the same period in the prior year. For much of the year, sales volumes were impacted by soft end market demand and inventory destocking by manufacturers and dealers. In the fourth quarter, however, sales volumes increased as customers began replenishing inventories. These favorable impacts were partially offset by higher general and administrative expenses compared to the prior year.

Plastics Segment

Plastics segment net income was $30.4 million, an $8.6 million decrease from the fourth quarter of 2024. The decrease was primarily driven by lower sales prices, which continued to decline throughout the year and were 20% lower in the fourth quarter compared to the same period last year. The impact of lower sales prices was partially offset by decreases in PVC resin and other input material costs and by higher sales volumes. The cost of input materials, including PVC resin, decreased 22% largely due to global supply and demand dynamics. Sales volumes increased 4% compared to the same period last year, largely driven by our increased production capacity.

Corporate

Corporate net loss was $7.6 million, an increase of $2.6 million from the net loss of $5.0 million in the fourth quarter of 2024. This increase was primarily the result of higher income tax expense, driven by higher state income taxes compared to last year.

2026 OUTLOOK

We anticipate 2026 diluted earnings per share to be in the range of $5.22 to $5.62. We expect our earnings mix in 2026 to be approximately 49% from our Electric segment and 51% from our Manufacturing and Plastics segments, net of corporate costs. Our anticipated earnings mix in 2026 deviates from our long-term expected earnings mix of 70% Electric and 30% Non-Electric as we expect Plastics segment earnings to remain elevated in 2026 compared to our long-term view of normal earnings for this segment.

The segment components of our 2026 diluted earnings per share guidance compared with actual earnings for 2025 are as follows:

									2025 EPS by Segment												2026 EPS Guidance
																											Low						High
Electric															$	2.32																	$	2.61					$	2.69
Manufacturing									0.27																		0.26						0.32
Plastics									4.05																		2.49						2.71
Corporate									(0.09)																		(0.14)						(0.10)
Total									$	6.55																	$	5.22					$	5.62
Return on Equity									15.6		%																11.5		%				12.3		%

The following items contribute to our 2026 earnings guidance:

Electric Segment - We expect segment earnings to increase 14% in 2026 based on the following:

•Returns generated from an increase in average rate base of 14% in 2026.

•Interim revenues commencing January 1, 2026 from our general rate case filed in Minnesota and anticipated final rates from our South Dakota general rate case.

•Increased operating and maintenance expenses from higher labor costs, planned outage costs at Big Stone Plant, and investments to promote system reliability.

•Increased depreciation and interest expense from our capital investments and associated financing.

Manufacturing Segment - We expect segment earnings to increase 7% in 2026 based on the following assumptions:

•Flat to modest increase in sales volumes in our contract metal fabrication business as conditions in certain end markets remain challenged.

•Increased sales volumes of horticulture products from improved end market conditions.

•Improved productivity partially offset by inflationary cost increases.

Plastics Segment - We expect segment earnings to decline 36% in 2026 based on the following assumptions:

•Continued decline in average product sales prices throughout 2026, as pricing continues to recede from the high point in 2022.

•Increased sales volumes from the new capacity added at our Phoenix facility, partially offset by a subdued housing market.

•Flat raw material costs in 2026 compared to 2025 as global supply and demand factors for PVC resin appear supportive of current pricing.

Corporate Costs - We expect our corporate costs to increase primarily from lower investment income and higher labor costs.

CAPITAL EXPENDITURES

The following provides a summary of actual capital expenditures for the year ended December 31, 2025, and anticipated annual capital expenditures for the next five years, along with average rate base and annual rate base growth of our Electric segment:

(in millions)												2025									2026						2027						2028						2029						2030						Total 2026 - 2030
Electric Segment:
Renewable Generation and Storage												$	91								$	251					$	295					$	89					$	4					$	6					$	645
Transmission												50									80						167						167						186						255						855
Distribution												88									55						49						53						54						57						268
Other												42									50						36						24						23						20						153
Total Electric Segment												271									436						547						333						267						338						1,921
Manufacturing and Plastics Segments												17									31						27						29						23						19						129
Total Capital Expenditures												$	288								$	467					$	574					$	362					$	290					$	357					$	2,050
Total Electric Utility Average Rate Base												$	2,108								$	2,403					$	2,773					$	3,108					$	3,260					$	3,423
Annual Rate Base Growth												11.4		%							14.0		%				15.4		%				12.1		%				4.9		%				5.0		%

Our updated five-year capital expenditure plan includes Electric segment investments in solar and battery storage resources, transmission and distribution assets, and investments in system reliability and technology. Our Electric segment capital expenditure plan produces a compounded annual growth rate on average rate base of 10% over the next five years and will serve as a key driver in increasing Electric segment earnings over this timeframe. Our capital expenditure plan in our Manufacturing and Plastics segments includes a mix of investments to replace and upgrade existing equipment and investments to add additional capacity or productivity to our operations.

CONFERENCE CALL AND WEBCAST

The corporation will host a live webcast on Tuesday, February 17, 2026, at 10:00 a.m. CT to discuss its financial and operating performance.

The presentation will be posted on our website before the webcast. To access the live webcast, go to www.ottertail.com/presentations and select “Webcast.” Please allow time prior to the call to visit the site and download any software needed to listen in. An archived copy of the webcast will be available on our website shortly after the call.

If you are interested in asking a question during the live webcast, visit and follow the link provided in the press release announcing the upcoming conference call.

FORWARD-LOOKING STATEMENTS

Except for historical information contained here, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words “anticipate,” “believe,” “can,” “confident,” “could,” “estimate,” “expect,” “future,” “goal,” “intend,” “likely,” “may,” “optimistic,” “opportunity,” “outlook,” “plan,” “possible,” “position,” “potential,” “predict,” “probable,” “projected,” “should,” “target,” “will,” “would” and similar words and expressions are intended to identify forward-looking statements.

Such statements are based upon the current beliefs and expectations of management. Forward-looking statements made herein, which may include statements regarding 2026 earnings and earnings per share, long-term earnings, earnings per share growth and earnings mix, anticipated levels of energy generation from renewable resources, anticipated reductions in carbon dioxide emissions, future investments and capital expenditures, rate base levels and rate base growth, future raw materials costs, future raw materials availability and supply constraints, future operating revenues and operating results, and expectations regarding regulatory proceedings, as well as other assumptions and statements, involve known and unknown risks and uncertainties that may cause our actual results in current or future periods to differ materially from the forecasted assumptions and expected results. The Company’s risks and uncertainties include, among other things, uncertainty of future investments and capital expenditures; rate base levels and rate base growth; risks associated with energy markets; the availability and pricing of resource materials; inflationary cost pressures; attracting and maintaining a qualified and stable workforce; changing macroeconomic and industry conditions that impact the demand for our products, pricing and margin; long-term investment risk; seasonal weather patterns and extreme weather events; future business volumes with key customers; reductions in our credit ratings; our ability to access capital markets on favorable terms; assumptions and costs relating to funding our employee benefit plans; our subsidiaries’ ability to make dividend payments; cybersecurity threats or data breaches; the impact of government executive orders, legislation and regulation including foreign trade policy; environmental, health and safety laws and regulations; changes in tax laws and regulations; the impact of climate change including compliance with legislative and regulatory changes to address climate change; expectations regarding regulatory proceedings, assigned service areas, the construction of major facilities, capital structure, and allowed customer rates; actual and threatened claims or litigation; and operational and economic risks associated with our electric generating and manufacturing facilities. These and other risks are more fully described in our filings with the Securities and Exchange Commission, including our most recently filed Annual Report on Form 10-K, as updated in subsequently filed Quarterly Reports on Form 10-Q, as applicable. Forward-looking statements speak only as of the date they are made, and we expressly disclaim any obligation to update any forward-looking information.

Category: Earnings

About the Corporation: Otter Tail Corporation, a member of the S&P SmallCap 600 Index, has interests in diversified operations that include an electric utility and manufacturing businesses. Otter Tail Corporation stock trades on the Nasdaq Global Select Market under the symbol OTTR. The latest investor and corporate information is available at www.ottertail.com. Corporate offices are in Fergus Falls, Minnesota, and Fargo, North Dakota.

Investor Contacts:    Beth Eiken, Manager of Investor Relations, (701) 451-3571

Media Contact:    Stephanie Hoff, Director of Corporate Communications, (218) 739-8535

# # #

OTTER TAIL CORPORATION

CONSOLIDATED STATEMENTS OF INCOME (unaudited)

			Three Months Ended December 31,												Twelve Months Ended December 31,
(in thousands, except per-share amounts)			2025						2024						2025						2024
Operating Revenues
Electric			$	149,708					$	139,818					$	566,756					$	524,515
Product Sales			158,391						163,293						737,302						806,033
Total Operating Revenues			308,099						303,111						1,304,058						1,330,548
Operating Expenses
Electric Production Fuel			18,993						15,936						75,048						60,945
Electric Purchased Power			22,796						19,055						78,658						61,561
Electric Operating and Maintenance Expense			47,479						54,055						184,310						190,422
Cost of Products Sold (excluding depreciation)			91,113						91,560						402,664						434,522
Nonelectric Selling, General, and Administrative Expenses			26,132						24,169						82,566						80,065
Depreciation and Amortization			29,731						27,541						118,107						107,121
Electric Property Taxes			4,236						3,971						17,023						15,662
Total Operating Expenses			240,480						236,287						958,376						950,298
Operating Income			67,619						66,824						345,682						380,250
Other Income and (Expense)
Interest Expense			(12,163)						(10,591)						(47,226)						(41,815)
Nonservice Components of Postretirement Benefits			894						2,412						3,334						9,609
Other Income (Expense), net			5,255						4,358						20,487						18,848
Income Before Income Taxes			61,605						63,003						322,277						366,892
Income Tax Expense			9,831						8,153						46,384						65,230
Net Income			$	51,774					$	54,850					$	275,893					$	301,662
Weighted-Average Common Shares Outstanding:
Basic			41,877						41,801						41,864						41,778
Diluted			42,149						42,088						42,117						42,072
Earnings Per Share:
Basic			$	1.24					$	1.31					$	6.59					$	7.22
Diluted			$	1.23					$	1.30					$	6.55					$	7.17

OTTER TAIL CORPORATION

CONSOLIDATED BALANCE SHEETS (unaudited)

			December 31,
(in thousands)			2025						2024
Assets
Current Assets
Cash and Cash Equivalents			$	386,193					$	294,651
Receivables, net of allowance for credit losses			145,496						145,964
Inventories			158,598						148,885
Investments			54,311						753
Regulatory Assets			20,437						9,962
Other Current Assets			34,690						29,826
Total Current Assets			799,725						630,041
Noncurrent Assets
Investments			78,823						121,177
Property, Plant and Equipment, net of accumulated depreciation			2,876,685						2,692,460
Regulatory Assets			86,062						98,673
Intangible Assets, net of accumulated amortization			4,642						5,743
Goodwill			37,572						37,572
Other Noncurrent Assets			80,770						66,416
Total Noncurrent Assets			3,164,554						3,022,041
Total Assets			$	3,964,279					$	3,652,082
Liabilities and Shareholders' Equity
Current Liabilities
Short-Term Debt			$	60,242					$	69,615
Current Maturities of Long-Term Debt			79,951						—
Accounts Payable			93,606						113,574
Accrued Salaries and Wages			35,666						34,398
Accrued Taxes			18,460						17,314
Regulatory Liabilities			16,600						29,307
Other Current Liabilities			46,433						45,582
Total Current Liabilities			350,958						309,790
Noncurrent Liabilities and Deferred Credits
Pension Benefit Liability			32,376						32,614
Other Postretirement Benefits Liability			31,813						27,385
Regulatory Liabilities			297,398						288,928
Deferred Income Taxes			305,931						267,745
Deferred Tax Credits			14,321						14,990
Other Noncurrent Liabilities			106,156						98,397
Total Noncurrent Liabilities and Deferred Credits			787,995						730,059
Commitments and Contingencies
Capitalization
Long-Term Debt			963,566						943,734
Shareholders’ Equity
Common Shares			209,528						209,140
Additional Paid-In Capital			434,195						429,089
Retained Earnings			1,217,567						1,029,738
Accumulated Other Comprehensive Income			470						532
Total Shareholders' Equity			1,861,760						1,668,499
Total Capitalization			2,825,326						2,612,233
Total Liabilities and Shareholders' Equity			$	3,964,279					$	3,652,082

OTTER TAIL CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

			Twelve Months Ended December 31,
(in thousands)			2025						2024
Operating Activities
Net Income			$	275,893					$	301,662
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:
Depreciation and Amortization			118,107						107,121
Deferred Tax Credits			(669)						(182)
Deferred Income Taxes			33,187						23,057
Investment Gains			(6,701)						(5,482)
Stock Compensation Expense			9,119						9,529
Other, net			(4,040)						(3,111)
Change in Operating Assets and Liabilities:
Receivables			468						11,179
Inventories			(4,751)						3,691
Regulatory Assets			(10,779)						5,194
Other Assets			(3,721)						(11,640)
Accounts Payable			(24,120)						14,826
Accrued and Other Liabilities			7,257						(10,371)
Regulatory Liabilities			2,190						16,821
Pension and Other Postretirement Benefits			(5,455)						(9,563)
Net Cash Provided by Operating Activities			385,985						452,731
Investing Activities
Capital Expenditures			(288,068)						(358,650)
Proceeds from Disposal of Noncurrent Assets			6,925						8,849
Purchases of Investments and Other Assets			(9,581)						(61,573)
Net Cash Used in Investing Activities			(290,724)						(411,374)
Financing Activities
Net Repayments of Short-Term Debt			(9,373)						(11,807)
Proceeds from Issuance of Long-Term Debt			100,000						120,000
Dividends Paid			(88,064)						(78,266)
Payments for Shares Withheld for Employee Tax Obligations			(3,134)						(6,457)
Other, net			(3,148)						(549)
Net Cash Provided by (Used in) Financing Activities			(3,719)						22,921
Net Change in Cash and Cash Equivalents			91,542						64,278
Cash and Cash Equivalents at Beginning of Period			294,651						230,373
Cash and Cash Equivalents at End of Period			$	386,193					$	294,651

OTTER TAIL CORPORATION

SEGMENT RESULTS (unaudited)

			Three Months Ended December 31,												Twelve Months Ended December 31,
(in thousands)			2025						2024						2025						2024
Operating Revenues
Electric			$	149,708					$	139,818					$	566,756					$	524,515
Manufacturing			77,183						66,632						314,547						342,592
Plastics			81,208						96,661						422,755						463,441
Total Operating Revenues			$	308,099					$	303,111					$	1,304,058					$	1,330,548
Operating Income (Loss)
Electric			$	33,122					$	25,680					$	121,549					$	113,789
Manufacturing			3,717						(606)						16,900						19,092
Plastics			41,212						52,769						231,079						271,905
Corporate			(10,432)						(11,019)						(23,846)						(24,536)
Total Net Income			$	67,619					$	66,824					$	345,682					$	380,250
Net Income (Loss)
Electric			$	26,376					$	21,478					$	97,586					$	90,963
Manufacturing			2,587						(590)						11,517						13,681
Plastics			30,362						38,919						170,400						200,747
Corporate			(7,551)						(4,957)						(3,610)						(3,729)
Total Net Income			$	51,774					$	54,850					$	275,893					$	301,662

FAQ

How did Otter Tail Corporation (OTTR) perform financially in 2025?

Otter Tail generated diluted earnings per share of $6.55 in 2025, with net income of $275.9 million. The company achieved a consolidated return on equity of 16%, supported by strong Electric segment results and solid cash flow from operations of $386.0 million.

What is Otter Tail Corporation’s 2026 earnings guidance?

For 2026, Otter Tail expects diluted earnings per share between $5.22 and $5.62. At the midpoint, this implies a projected return on equity of about 12%, with approximately 49% of earnings from Electric and 51% from Manufacturing and Plastics, net of corporate costs.

How did Otter Tail’s Electric segment perform in 2025?

In 2025, the Electric segment’s operating revenues rose to $566.8 million and net income increased to $97.6 million. Growth was driven by higher retail sales volumes, increased fuel recovery revenues, recovery of rate base investments, and favorable weather, partly offset by higher depreciation and interest expense.

What happened in Otter Tail’s Plastics segment during 2025?

The Plastics segment saw operating revenues decline to $422.8 million and net income decrease to $170.4 million in 2025. A 15% drop in average sales prices drove results lower, partly offset by an 8% increase in volumes and a 14% reduction in PVC resin and other input costs.

What capital expenditure and rate base growth plans has Otter Tail outlined?

Otter Tail plans total capital expenditures of about $2.05 billion from 2026 to 2030, including $1.92 billion in its Electric segment. This plan is expected to support roughly 10% compounded annual growth in average Electric rate base over five years, driven by renewables, transmission, and distribution investments.

How strong is Otter Tail Corporation’s liquidity and balance sheet?

As of December 31, 2025, Otter Tail reported $386.2 million in cash and cash equivalents and $319.3 million of available credit facility capacity. Total available liquidity was $705.5 million, supporting its planned capital program and dividend payments of $88.1 million in 2025.

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